UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)*
JDS UNIPHASE CORPORATION
---------------------------------------
(Name of Issuer)
Common Stock par value $0.001 per share
---------------------------------------
(Title of Class of Securities)
466125 10 1
---------------------------------------
(CUSIP Number)
Osamu Sato, General Manager/Finance and Accounting Department
6-1, Marunouchi 2-chome,
Chiyoda-ku, Tokyo 100-8322
Japan
81-3-3286-3526
------------------------------------------------------------
(Name, Address and Telephone Number of Persons Authorized to
Receive Notices and Communications)
February 4, 2000
------------------------------------------------------
(Date of Event which requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is filing
this schedule because of section 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g),
check the following box |_|.
Note: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See section 240.13d-7(b)
for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
<PAGE>
CUSIP No. 466125 10 1
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1. Names of Reporting Persons
I.R.S. Identification Nos. of Above Persons (entities only)
The Furukawa Electric Co., Ltd.
FEJ Holding Inc.
FEJ Sales Inc.
- --------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) |_| X
(b) |_|
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3. SEC Use Only
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4. Source of Funds (See Instructions)
WC, OO
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5. Check if Disclosure of Legal Proceedings is Required Pursuant to
Item 2(d) or 2(e). |_|
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6. Citizenship or Place of Organization
The Furukawa Electric Co., Ltd.: Japan
FEJ Holding Inc.: Canada
FEJ Sales Inc.: Canada
- --------------------------------------------------------------------------------
7. Sole Voting Power
0
- ------ Number of Shares -----------------------------------------------
8. Beneficially Shared Voting Power
Owned
By 72,367,040
Each
- ------ Reporting Person -----------------------------------------------
9. With Sole Dispositive Power
0
- ------ -----------------------------------------------
10. Shared Dispositive Power
72,367,040
- --------------------------------------------------------------------------------
11. Aggregate Amount Beneficially Owned by Each Reporting Person
72,367,040
- --------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions) |_|
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13. Percent of Class Represented by Amount in Row (11)
Approximately 20.244%
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14. Type of Reporting Person (See Instructions)
CO
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Page 1 of 7
<PAGE>
Amendment No. 3 to Schedule 13D
Item 1. Security and Issuer
This Amendment No. 3 amends and supplements the Statement on Schedule
13D (the "Schedule 13D") jointly filed with the Securities and Exchange
Commission on July 6, 1999 by The Furukawa Electric Co., Ltd. ("Furukawa"), FEJ
Holding Inc. ("FEJH") and FEJ Sales Inc. and subsequently amended on December 1,
1999 and January 27, 2000. This Amendment No. 3 to Schedule 13D relates to
shares of common stock, par value $0.001 per share (the "Common Stock"), of JDS
Uniphase Corporation (the "Issuer"). The principal executive office and mailing
address of the Issuer is 163 Baypointe Parkway, San Jose, CA 95134. All
capitalized terms used in this Amendment and not otherwise defined herein have
the meanings ascribed to such terms in the Schedule 13D. Only those Items that
are amended or supplemented are reported herein. Except as amended and
supplemented, the Schedule 13D, including the definitions of terms not otherwise
defined herein, remains in full force and effect.
Item 4. Purpose of Transactions
A. Completion of Transaction Previously Disclosed in Amendment No. 2
On January 27, 2000, FEJH entered into an ISDA Master Agreement
(including the Schedule and Credit Support Annex thereto, the "ISDA Master
Agreement"), with a broker-dealer (the "Dealer") and a Confirmation pursuant to
such ISDA Master Agreement (the "First Confirmation"). This transaction was
previously disclosed in Amendment No. 2 to the Schedule 13D dated January 27,
2000. The final pricing with respect to the First Confirmation has now been
completed. This Amendment No. 3 supplements the disclosure in Amendment No. 2 by
attaching the Final Pricing Notice and a letter from Furukawa to the Dealer with
respect to the First Confirmation.
B. New Transaction
On February 4, 2000, FEJH entered into a Confirmation (the "Second
Confirmation") to the ISDA Master Agreement, pursuant to which FEJH may sell up
to 950,000 shares of the Common Stock to the Dealer and pledge such shares to
the Dealer. The principal purpose of this transaction is to hedge the market
risk of a portion of the Exchangeable Shares held by the Reporting Persons.
Item 6. Contracts, Arrangements, Understanding or Relationships with Respect to
Securities of the Issuer
Pursuant to the Second Confirmation, FEJH may sell up to 950,000
shares of the Common Stock to the Dealer and pledge such shares to the Dealer.
Page 2 of 7
<PAGE>
Item 7. Material to be Filed as Exhibits
Exhibit No. Description
- ----------- -----------
1 Final Pricing Notice, dated as of February 4, 2000, which supplements
the First Confirmation.
2 Letter from Furukawa to the Dealer, dated as of January 27, 2000,
with respect to the First Confirmation.
3 The Second Confirmation.
4 Irrevocable Authorization and Instruction, dated as of February 4,
2000, given by FEJH to the Dealer.
5 Letter from Furukawa to the Dealer, dated as of February 4, 2000,
with respect to the Second Confirmation.
6 Final Pricing Notice, dated as of February 7, 2000, which supplements
the Second Confirmation.
Page 3 of 7
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: February 4, 2000
THE FURUKAWA ELECTRIC CO., LTD.
By: /s/ Osamu Sato
-------------------------------------
Name: Osamu Sato
Title: General Manager/Finance and
Accounting Department
Page 4 of 7
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: February 4, 2000
FEJ HOLDING INC.
By: /s/ Osamu Sato
------------------------------
Name: Osamu Sato
Title: Vice President
Page 5 of 7
<PAGE>
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: February 4, 2000
FEJ SALES INC.
By: /s/ Jo Kubota
------------------------------
Name: Jo Kubota
Title: Director
Page 6 of 7
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
1 Final Pricing Notice, dated as of February 4, 2000, which supplements
the First Confirmation.
2 Letter from Furukawa to the Dealer, dated as of January 27, 2000,
with respect to the First Confirmation.
3 The Second Confirmation.
4 Irrevocable Authorization and Instruction, dated as of February 4,
2000, given by FEJH to the Dealer.
5 Letter from Furukawa to the Dealer, dated as of February 4, 2000,
with respect to the Second Confirmation.
6 Final Pricing Notice, dated as of February 7, 2000, which supplements
the Second Confirmation.
Page 7 of 7
<PAGE>
EXHIBIT 1
EXHIBIT A
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
New York, N.Y. 10281-1305
February 4, 2000
FEJ Holding Inc.
c/oThe Furukawa Electric Co., Ltd.
6-1, Marunouchi 2-chome
Chiyoda-ku, Tokyo 100-8322, Japan
Attention: Assistant Manager
Fax No. (813) 3286-3709
Ladies and Gentlemen:
This Final Pricing Notice is the Final Pricing Notice within the
meaning of the Master Agreement (including the Schedule thereto and the Credit
Support Annex incorporated therein) dated as of January 27, 2000, between FEJ
Holding Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPFS")
(as supplemented by the Confirmation dated as of January 27, 2000 between you
and MLPFS, the "Confirmation").
For all purposes under the Confirmation, the terms of the Confirmation
shall be as follows:
1. Effective Date: _February 7, 2000___.
2. Number of Shares: _3,500,000__________.
3. Initial Payment Amount: _USD 715,189,837.23_.
4. Initial Payment Date: _February 10, 2000___.
5. Initial Equity Level: __211.7512__.
6. Floor Price: _210.4383_________.
7. Cap Price: __213.3393________.
8. Valuation Date: _August 28, 2000__________.
9. Settlement Date: _August 31, 2000___.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By: /s/ Elizabeth Murphy
---------------------------------
Name: Elizabeth Murphy
Title: Authorized Signatory
<PAGE>
Acknowledged and Confirmed:
FEJ HOLDING INC.
By: /s/ Osamu Sato
---------------------------------
Name: Osamu Sato
Title: Vice President
<PAGE>
EXHIBIT 2
January 27, 2000
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPFS")
World Financial Center
North Tower
New York, New York 10281-1305
Dear Sirs:
This is in reference to the OTC share transaction ML Transaction Ref. (to be
determined) (the "Transaction") entered into between MLPFS and FEJ Holding Inc.
("FEJH"), as evidenced by the confirmation (the "Confirmation") dated as of
January 27, 2000 (or such other date as may be agreed between the parties). The
Confirmation supplements, forms part of, and is subject to, the ISDA Master
Agreement (including the Schedule thereto and the Credit Support Annex
incorporated therein), dated as of January 27, 2000 (the "Agreement"). Defined
terms used in this letter agreement and not otherwise defined shall have the
same meanings as stated in the Confirmation.
We, The Furukawa Electric Co., Ltd. ("FE"), hereby confirm to MLPFS that FEJH is
a wholly-owned subsidiary of FE. FE also acknowledges that the Confirmation
requires FEJH to pledge the shares of JDS Uniphase Corporation (the "JDSU
Shares") to MLPFS as Collateral.
In order to induce MLPFS to enter into the Transaction, FE acknowledges and
agrees that in the event MLPFS shall not have received as Collateral on or prior
to the twentieth Business Day following the Trade Date a Transfer of an amount
of JDSU Shares equal to the Number of Shares, due to the revocation or
withdrawal by FEJH of its Retraction Request (as defined in Article 6 of the
Articles of Incorporation of FEJH) then, MLPFS shall have the right to seek
compensation directly from FE (without first pursuing a claim against FEJH) for
any losses, expenses (including reasonable fees and expenses of counsel to
MLPFS), claims, damages or liabilities to which MLPFS may suffer or become
subject to, insofar as such losses, expenses (including reasonable fees and
expenses of counsel to MLPFS), claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon such revocation or withdrawal by
FEJH of its Retraction Request. The rights of MLPFS under this letter shall be
in addition to any rights or remedies that MLPFS may have under the terms of the
Confirmation and the Agreement.
FE shall be released from all of its obligations under this letter agreement
upon the delivery to MLPFS of an amount of JDSU Shares equal to the Number of
Shares as required under the terms of the Confirmation and the Agreement. FE may
not assign or delegate any of its duties hereunder.
Sincerely yours,
THE FURUKAWA ELECTRIC CO., LTD.
By: /s/ Junnosuke Furukawa
-----------------------------------
Name: Junnosuke Furukawa
Title: President and CEO
Accepted and agreed:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By: /s/ Elizabeth Murphy
-----------------------------------
Name: Elizabeth Murphy
Title: Authorized Signatory
<PAGE>
EXHIBIT 3
[OBJECT OMITTED]
Dated : February 4, 2000 ML Ref :
To : FEJ Holding Inc. ("Counterparty" or "FEJH")
9902 49th Street, P.O. Box 939
Yellowknife, NWT, Canada
Attention : Assistant Manager
Telephone: (813) 3286-3709 Fax: (813) 3286-3526
From : Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPFS")
tel: (212) 449-8675
fax: (212) 449-2697
- ------------------------------------------------------------------------------
Dear Sir / Madam:
The purpose of this letter agreement (this "Confirmation") is to confirm the
terms and conditions of the above referenced Share Transaction entered into
between Counterparty and MLPFS on the Trade Date specified below (the
"Transaction"). This Confirmation constitutes a "Confirmation" as referred to in
the Master Agreement specified below.
The definitions and provisions contained in the 1991 ISDA Definitions (as
supplemented by the 1998 Supplement, the "Swap Definitions") and in the 1996
ISDA Equity Derivatives Definitions (the "Equity Definitions", and together with
the Swap Definitions, the "Definitions"), in each case as published by the
International Swaps and Derivatives Association, Inc., are incorporated into
this Confirmation. In the event of any inconsistency between the Swap
Definitions and the Equity Definitions, the Equity Definitions will govern. In
the event of any inconsistency between this Confirmation and the Agreement (as
defined below) or the Definitions, the terms of this Confirmation shall govern.
This Confirmation supplements, forms part of, and is subject to, the Master
Agreement (including the Schedule thereto (the "ISDA Schedule") and the Credit
Support Annex thereto (the "Credit Support Annex")), dated as of January 27,
2000, as amended and supplemented from time to time (the "Agreement"), between
you and us. All provisions contained in the Agreement govern this Confirmation
except as expressly modified below.
The terms of the particular Transaction to which this Confirmation relates are
as follows:
General Terms:
Trade Date: February 4, 2000
Valuation Date: August 28, 2000, as specified in the Final Pricing
Notice
Seller: Counterparty
Buyer: MLPFS
Shares: The common stock, USD 0.001 par value per share, of
JDS Uniphase Corporation (Security Symbol: JDSU ).
Issuer: JDS Uniphase Corporation, a Delaware corporation
Number of Shares: 1 million, as may be reduced in the manner set
forth opposite the caption, "Hedging Period", as
specified in the Final Pricing Notice.
<PAGE>
Initial Equity Level: The volume weighted average price per share at
which Buyer executed sales and purchases of Shares
in the open market during the initial Hedging
Period as set forth opposite the caption "Hedging
Period", as specified in the Final Pricing Notice.
Floor Price: The USD price per share equal to 99.38% of the
Initial Equity Level, as specified in the Final
Pricing Notice.
Cap Price: The USD price per share equal to 100.75% of the
Initial Equity Level, as specified in the Final
Pricing Notice.
Final Equity Level: With respect to any Averaging Date, the closing
price per Share at the Valuation Time on such
Averaging Date.
Settlement Date: Three Exchange Business Days after the Valuation
Date, as specified in the Final Pricing Notice.
Notional Amount: The US dollar amount, as determined by the
Calculation Agent, equal to the product of the
Initial Equity Level and the Number of Shares.
Initial Payment Date: The date three Exchange Business Days after the
Effective Date, as specified in the Final Pricing
Notice.
Initial Payment Amount: An amount in USD equal to an amount in USD equal to
96.5% of the Notional Amount, as specified in the
Final Pricing Notice.
Settlement Currency: USD
Exchange: Nasdaq National Market
Related Exchange: Any exchange(s) on which options contracts related
to the Shares are principally traded.
Business Days: New York
Initial Hedging Period:
Hedging Period: During the period (the "Hedging Period") commencing
on the Trade Date and ending on the earlier to
occur of (x) the tenth Exchange Business Day
following the Trade Date (the "Cut-Off Date") and
(y) the Exchange Business Day on which MLPFS
completes the sale of the full Number of Shares
(such earlier date, the "Last Hedging Date") MLPFS
will make a good faith effort to sell the full
Number of Shares in unsolicited brokerage
transactions. On the Last Hedging Date, MLPFS shall
provide written notice (a "Final Pricing Notice")
to Counterparty in substantially the form of
Exhibit A, of the Initial Equity Level, Floor
Price, Cap Price, Effective Date, Initial Payment
Date and Initial Payment Amount. If MLPFS does not
sell the full Number of Shares by the 4:00 p.m.
close of trading on the Exchange on the Cut-Off
Date, MLPFS shall notify Counterparty in the Final
Pricing Notice that the Number of Shares shall be
reduced to such number as MLPFS has sold in
accordance with this paragraph. MLPFS' calculations
shall be reasonable and conclusive and binding
absent manifest error.
Effective Date: The Exchange Business Day following the Last
Hedging Date, as specified in the Final Pricing
Notice.
Initial Payment: On the Initial Payment Date MLPFS will purchase and
hold in escrow for Counterparty Zero-coupon U.S.
Treasury securities maturing on August 17,
2
<PAGE>
2000 ("Treasuries") with an aggregate purchase
price (including fees and commissions) that is
equal to the Initial Payment Amount at a purchase
price of such Treasuries equal to 97.10% (expressed
as a percentage of par); provided, that, in lieu of
purchasing any fractional Treasuries, MLPFS shall
deposit in escrow an amount of cash equal to the
principal amount of such fractional Treasuries.
Purchase of such Treasuries and deposit of any such
cash shall be made by 10:00 a.m. (local time at the
place for payment) on that date. The proceeds of
such Treasuries together with such cash shall be
held in escrow and shall be released to the
Counterparty upon the delivery of Shares to MLPFS
pursuant to the provisions set forth opposite the
caption "Delivery of the Number of Shares to be
Delivered" on the earlier of (A) the Settlement
Date or (B) any Early Termination Date under the
Agreement (the "Release Date").
Upon release to the Counterparty by MLPFS of such
principal and proceeds on the Release Date, MLPFS
shall have no further payment obligations to
Counterparty hereunder.
Valuation:
Valuation Time: At the 4:00 p.m. close of trading on the Exchange.
Averaging Dates: Each of the 20 consecutive Exchange Business Days
ending on and including the Valuation Date.
Averaging Date Market
Disruption: Modified Postponement
Physical Settlement Terms:
Physical Settlement: On the Settlement Date, Counterparty will deliver
to MLPFS Shares in an amount equal to the Number of
Shares to be Delivered that would constitute Free
Shares in the hands of MLPFS upon delivery to
MLPSS.
"Free Shares" means Shares that are not subject to
any condition to or restriction on the ability of
the holder thereof to sell, assign or otherwise
transfer such Shares (or security entitlements in
respect thereof) or to enforce the provisions
thereof or of any document related thereto whether
set forth in such Shares itself or in any document
related thereto, including, without limitation, (i)
any requirement that any sale, assignment or other
transfer or enforcement of such Shares (or security
entitlements in respect thereof) be consented to or
approved by any person, including, without
limitation, the Issuer or any other obligor
thereon, (ii) any limitations on the type or
status, financial or otherwise, of any purchaser,
pledgee, assignee or transferee of such Shares (or
security entitlements in respect thereof), (iii)
any requirement of the delivery of any certificate,
consent, agreement, opinion of counsel, notice or
any other document of any person to the Issuer, any
other obligor on or any registrar or transfer agent
for, such Shares (or security entitlements in
respect thereof), prior to the sale, pledge,
assignment or other transfer or enforcement of such
Shares (or security entitlements in respect
thereof) or other item of collateral and (iv) any
registration or qualification requirement or
prospectus delivery requirement for such Shares (or
security entitlements in respect thereof) pursuant
to any federal, state or foreign securities law
(including, without limitation, any such
requirement arising as a result of Rule 144 or Rule
145 under the Securities Act); except that the
required delivery of any assignment, instruction or
entitlement order from the seller, pledgor,
assignor or transferor of such Shares (or security
entitlements in respect thereof), together with any
evidence of the corporate or other authority of
such person, shall not constitute such a condition
or restriction.
3
<PAGE>
Number of Shares
to be Delivered: The number of Shares equal to the sum of the
Averaging Date Share Numbers for each of the
Averaging Dates.
Averaging Date Share Number: With respect to any Averaging Date, the number of
Shares, as determined by the Calculation Agent,
equal to the product of (i) the amount obtained by
multiplying the Number of Shares by the Multiplier
relating to such Averaging Date and (ii) the
fraction with a numerator equal to one (1) and a
denominator equal to the number of Averaging Dates,
provided that, if the calculation of any Averaging
Date Share Number results in any fractional Share,
such Averaging Date Share Number shall be rounded
up to the next whole number of Shares.
Multiplier: With respect to any Averaging Date, the number, as
determined by the Calculation Agent, pursuant to
the following formula:
a) if the Final Equity Level with respect to such
Averaging Date is less than the Floor Price,
one (1);
b) if the Final Equity Level with respect to such
Averaging Date is less than or equal to the
Cap Price but greater than or equal to the
Floor Price, a number equal to the quotient
obtained by dividing the Floor Price by the
Final Equity Level with respect to such
Averaging Date; and
c) if the Final Equity Level with respect to such
Averaging Date is greater than the Cap Price,
a number equal to the quotient obtained by
dividing the Floor Price by the Cap Price.
Clearance System(s): The principal domestic clearance system customarily
settling trades on a delivery versus payment basis
on the Shares.
Delivery of Number of Shares
to be Delivered: On the Settlement Date, Counterparty shall satisfy
its delivery obligation by delivering to MLPFS a
number of Free Shares equal to the Number of the
Shares to be Delivered.
On the Settlement Date, unless (i) Counterparty
shall have otherwise effected the deliveries
required hereby or (ii) the Shares (or security
entitlements in respect thereof) then held by the
MLPFS as Collateral hereunder are not Free Shares,
MLPFS shall take, and the Counterparty irrevocably
instructs MLPFS to take, in whole or partial, as
the case may be, satisfaction of Counterparty's
obligations to deliver Shares (or security
entitlements in respect thereof) to MLPFS on the
Settlement Date pursuant hereto, Shares (or
security entitlements in respect thereof) then held
by it as Collateral hereunder representing the
number of Shares (or security entitlements in
respect thereof) required to be delivered hereunder
on the Settlement Date. Upon any such deemed
delivery, MLPFS shall hold such Shares (or security
entitlements in respect thereof) absolutely and
free from any claim or right whatsoever (including,
without limitation, any claim or right of
Counterparty).
Adjustments:
Method of Adjustment: In the event of the occurrence of a Potential
Adjustment Event, the Calculation Agent will
determine whether such Potential Adjustment Event
has a diluting or concentrative effect on the
theoretical value of the Shares and, if so, will
(i) make the corresponding adjustment(s), if any,
to the Number of Shares, the Floor Price and the
Cap Price and, in any case, any other variable
relevant to the settlement or payment terms of this
transaction
4
<PAGE>
as the Calculation Agent determines appropriate to
account for that diluting or concentrative effect
and (ii) determine the effective date(s) of the
adjustment(s). For the avoidance of doubt, in
connection with the adjustments made pursuant to
the preceding sentence, if as a result of a
Potential Adjustment Event existing holders of
Shares receive a distribution or dividend of
securities (other than Shares) that are marketable
securities (the "Additional Securities"), then the
term "Shares" will mean a basket of Shares composed
of the original Shares and the Additional
Securities and the Transaction will become a Share
Basket Transaction. The Calculation Agent may (but
need not) determine the appropriate adjustment(s)
by reference to any adjustment(s) in respect of
such Potential Adjustment Event made by an options
exchange to options on the relevant Shares traded
on that options exchange.
Extraordinary Events:
Merger Event: In respect of any relevant Shares, any (i)
reclassification or change of such Shares that
results in a transfer of or an irrevocable
commitment to transfer 50% or more of such Shares
outstanding, (ii) consolidation, amalgamation or
merger of the Issuer with or into another entity
(other than a consolidation, amalgamation or merger
in which such Issuer is the continuing entity and
which does not result in any such reclassification
or change of 50% or more of such Shares
Outstanding) or (ii) other takeover offer for such
Shares that results in a transfer of or an
irrevocable commitment to transfer 50% or more of
such Shares (other than such Shares owned or
controlled by the offeror), in each case if the
Merger Date is on or before, the final Valuation
Date.
Consequences of Merger Event:
(a) Share-for-Share: Cancellation and Payment; provided however, if the
New Shares are publicly traded on a nationally
recognized exchange or on the Nasdaq National
Market, Alternative Obligation shall apply.
(b) Share-for-Other: Cancellation and Payment.
(c) Share-for-Combined: Cancellation and Payment; provided however, if any
portion of the consideration for the relevant
shares consists of equity securities that are
publicly traded on a nationally recognized exchange
or on Nasdaq (the "Publicly Traded Securities
Consideration"), Alternative Obligation shall apply
only to that portion of the Transaction
corresponding to the Publicly Traded Securities
Consideration.
Notwithstanding anything to the contrary in the
Equity Definitions, the amount payable under this
Transaction upon the occurrence of an Extraordinary
Event shall be calculated by the Calculation Agent
in good faith in accordance with Section 9.7 of the
Equity Definitions using, among other things, the
factors identified in subparagraphs (i), (ii) and
(iii) therein, but without the requirement of
soliciting dealer quotations therefor. The
Calculation Agent may (but need not) determine the
appropriate adjustment to such payable amount by
reference to any adjustment(s) in respect of such
Extraordinary Event made by an options exchange to
options on the relevant Shares traded on that
options exchange.
Nationalization or
Insolvency: Negotiated Close-out
If any Merger Event shall occur that does not
result in a termination of this transaction, the
Calculation Agent shall calculate the adjustments,
if any, to be made to any one or more of the Number
of Shares, the Floor Price, the Cap
5
<PAGE>
Price, and any other variable relevant to the
settlement terms of this Agreement, as the
Calculation Agent reasonably determines to be
appropriate to account for such event. The
Calculation Agent may (but need not) determine the
appropriate adjustment to such variables by
reference to any adjustment(s) in respect of such
Merger Event made by an options exchange to options
on the relevant Shares traded on that options
exchange.
Additional Termination
Events: If, on any Business Day on or after the twentieth
Business Day following the Trade Date (such
twentieth day, the "Share Collateralization Date"),
MLPFS is no longer able to borrow (or maintain a
borrowing of) Shares in an amount equal to the
Number of Shares (other than failure of MLPFS to
receive as Collateral on or prior to the Share
Collateralization Date a Transfer of Eligible
Collateral consisting of Shares in an amount equal
to the Number of Shares due solely to the gross
negligence of MLPFS) ("Loss of Borrow Event"),
MLPFS may, upon not less than three (3) Business
Days' prior notice (the "Notice Period") to
Counterparty, elect to terminate this Transaction;
provided that if, during the Notice Period,
Counterparty lends to MLPFS such amount of Shares
pursuant to the terms of this Agreement, then for
so long as the Shares are so borrowed, MLPFS shall
not terminate this Transaction under this
provision. A Loss of Borrow Event shall constitute
an Additional Termination Event with respect to
this Transaction (with two Affected Parties).
If, for any reason (other than due solely to the
gross negligence of MLPFS), MLPFS fails to receive
as Collateral on or prior to the Share
Collateralization Date a Transfer of Eligible
Collateral consisting of Shares in an amount equal
to the Number of Shares (as described below under
the caption "Collateral"), then MLPFS may elect to
immediately terminate this Transaction, and such
failure to receive Shares on or prior to such date
shall constitute an Additional Termination Event
with respect to this Transaction (with two Affected
Parties).
Termination Provisions: The provisions of Part 1(c) (relating to Cross
Default) and Part 1(d) (relating to Credit Event
Upon Merger) of the ISDA Schedule shall not apply
to this Transaction (for all purposes under the
Agreement, including any relevant provisions of the
Credit Support Annex).
Calculation Agent: MLPFS
Non-Reliance: Each party represents to the other party that it is
acting for its own account, and has made its own
independent decisions to enter into this
Transaction and as to whether this Transaction is
appropriate or proper for it based on its own
judgment and upon advice from such advisors as it
has deemed necessary. It is not relying on any
communication (written or oral) of the other party
as investment advice or as a recommendation to
enter into this Transaction, it being understood
that information and explanations related to the
terms and conditions of this Transaction shall not
be considered investment advice or a recommendation
to enter into this Transaction. No communication
(written or oral) received from the other party
shall be deemed to be an assurance or guarantee as
to the expected results of this Transaction.
Governing law: The laws of the State of New York (without
reference to choice of law doctrine)
Collateral:
Supplemental
Collateral Provisions: (a) Counterparty hereby assigns and pledges to
MLPFS, and grants to MLPFS, as the Secured
Party, security interests in and to, and a
lien upon and right of set-off against, and
transfers to MLPFS, as and by way of a
security interest having priority over all
other security
6
<PAGE>
interests, with power of sale, all of its
right, title and interest in and to (i) the
pledged items described in paragraph (b)
below; (ii) all additions to and substitutions
for such pledged items; (iii) all income,
proceeds and collections received or to be
received, or derived or to be derived, now or
any time hereafter (whether before or after
the commencement of any proceeding under
applicable bankruptcy, insolvency or similar
law, by or against Counterparty, with respect
to Counterparty) from or in connection with
such pledged items (including, without
limitation, any shares of capital stock issued
by the Issuer in respect of any Shares (or
security entitlements in respect thereof)
constituting Collateral or any cash,
securities or other property distributed in
respect of or exchanged for any Shares (or
security entitlements in respect thereof)
constituting Collateral, or into which any
such Shares (or security entitlements in
respect thereof) are converted, in connection
with any Merger Event, and any security
entitlements in respect of any of the
foregoing); and (iv) all powers and rights now
owned or hereafter acquired under or with
respect to such pledged items (such pledged
items, additions, substitutions, proceeds,
collections, powers and rights being herein
collectively called the "Collateral"). MLPFS
shall have all of the rights, remedies and
recourses with respect to the Collateral
afforded a secured party by the New York
Uniform Commercial Code, in addition to, and
not in limitation of, the other rights,
remedies and recourses afforded to MLPFS by
this Agreement.
(b) On or prior to the Trade Date, Counterparty
shall Transfer to MLPFS in pledge hereunder,
and thereafter maintain with MLPFS, Eligible
Collateral consisting of Shares or
Exchangeable Shares exchangeable into Shares,
in an aggregate amount equal to the Number of
Shares.
(c) In the event that the Issuer at any time
issues to Counterparty in respect of any
Eligible Collateral (or security entitlements
in respect thereof) constituting Collateral
hereunder any additional or substitute shares
of capital stock of any class (or any security
entitlements in respect thereof), Counterparty
shall immediately pledge and Transfer to MLPFS
all such shares and security entitlements as
additional Collateral hereunder.
(d) The security interests granted hereby with
respect to the Collateral (the "Security
Interests") are granted as security only and
shall not subject MLPFS to, or transfer or in
any way affect or modify, any obligation or
liability of Counterparty or the Issuer with
respect to any of the Collateral or any
transaction in connection therewith.
(e) MLPFS shall have the right to receive and
retain as Collateral hereunder all proceeds of
the Collateral, including without limitation
any dividends or interest, and Counterparty
shall take all such action as MLPFS shall deem
necessary or appropriate to give effect to
such right. All such proceeds including,
without limitation, all dividends and other
payments and distributions that are received
by the Counterparty shall be received in trust
for the benefit of MLPFS and, if MLPFS so
directs, shall be segregated from other funds
of Counterparty and shall, forthwith upon
demand by MLPFS, be paid over to MLPFS as
Collateral in the same form as received (with
any necessary endorsement). MLPFS shall retain
any and all ordinary cash dividends received
by it hereunder as Collateral to be used by
MLPFS toward satisfaction of Counterparty's
obligations under paragraph (n) under the
caption, "Representations and Agreements of
Counterparty," below.
7
<PAGE>
(f) Certain Additional Definitions. For purposes
of this Transaction, the following terms shall
have the meanings set forth below.
"Eligible Collateral" means (x) Shares, (y)
Exchangeable Shares ("Exchangeable Shares") of
JDS Uniphase Canada Ltd. ("JDSU Canada") or
(z) security entitlements in respect thereof,
provided that Pledgor has good and marketable
title thereto, free of all liens (other than
the Security Interests) and transfer
restrictions (other than the transfer
restrictions imposed by Rule 144 or Rule 145
(other than Rule 144(d)) under the Securities
Act as a result of such Shares being held by
an affiliate of the Issuer) and that MLPFS has
a valid, first priority perfected security
interest therein, a first lien thereon and
control with respect thereto.
"Transfer" means, with respect to any Eligible
Collateral, (i) in the case of certificated
securities that cannot be paid or delivered by
book-entry, payment or delivery in appropriate
physical form to the recipient or its account
accompanied by any duly executed instruments
of transfer, assignments in blank, transfer
tax stamps and any other documents necessary
to constitute a legally valid transfer to the
recipient; (ii) in the case of securities that
can be paid or delivered in book-entry, the
giving of written instruments to the relevant
depository institution or other entity
specified by the recipient, together with a
written copy thereof to the recipient,
sufficient if complied with to result in a
legally effective transfer of the relevant
interest to the recipient; and (iii) in the
case of Exchangeable Shares constituting
Eligible Collateral, in addition to the
requirements set forth in clause (i) or (ii)
above, as applicable, the delivery to MLPFS of
an irrevocable instruction and authorization
to immediately tender such Exchangeable Shares
for exchange into Shares (accompanied by any
duly executed instruments and other documents
necessary to effect such exchange). For the
avoidance of doubt, any irrevocable
instruction and authorization under clause
(iii) of the previous sentence shall include
an authorization that MLPFS shall hold the
exclusive authority, to the extent permitted
by applicable law, to cancel or revoke any
instruction to the exchange agent for the
Exchangeable Shares to exchange any
Exchangeable Shares.
(g) Unless an Event of Default shall have occurred
and be continuing and subject to the
limitations under paragraph (i) below,
Counterparty shall have the right, from time
to time, to vote and to give consents,
ratifications and waivers with respect to the
Collateral, and MLPFS shall, upon receiving a
written request from Counterparty accompanied
by a certificate of an authorized officer of
Counterparty stating that no Event of Default
has occurred and is continuing, deliver to
Counterparty or as specified in such request
such proxies, powers of attorney, consents,
ratifications and waivers in respect of any of
the Collateral that is registered, or held
through a securities intermediary, in the name
of MLPFS or its nominee as shall be specified
in such request and shall be in form and
substance satisfactory to MLPFS.
(h) If an Event of Default shall have occurred and
be continuing, MLPFS shall have the right, to
the extent permitted by law, and Counterparty
shall take all such action as may be necessary
or appropriate to give effect to such right,
to vote and to give consents, ratifications
and waivers, and to take any other action with
respect to any or all of the Collateral with
the same force and effect as if MLPFS were the
absolute and sole owner thereof.
8
<PAGE>
Upon the occurrence of any event or condition
which with the giving of notice or passage of
time or both would qualify as an "Event of
Default" or "Termination Event" under the
Agreement with respect to the Counterparty
being the "Defaulting Party" or "Affected
Party", as the case may be, MLPFS shall have
the right to declare all of Counterparty's
payment obligations due and payable. In such
event, unless (A) Counterparty shall have
otherwise effected the deliveries required
hereby or (B) the Shares (or security
entitlements in respect thereof) then held by
the MLPFS as Collateral hereunder are not Free
Shares, MLPFS shall take, and the Counterparty
irrevocably instructs MLPFS to take, in whole
or partial, as the case may be, satisfaction of
Counterparty's obligations to deliver Shares
(or security entitlements in respect thereof)
to MLPFS on the Settlement Date pursuant
hereto, Shares (or security entitlements in
respect thereof) then held by it as Collateral
hereunder representing the number of Shares (or
security entitlements in respect thereof)
required to be delivered hereunder on the Early
Termination Date. Upon any such deemed
delivery, MLPFS shall hold such Shares (or
security entitlements in respect thereof)
absolutely and free from any claim or right
whatsoever (including, without limitation, any
claim or right of Counterparty) in Shares and
may be satisfied by deemed delivery of Shares
held as Collateral.
(i) For purposes of this Transaction, in addition
to the permitted uses of Collateral provided
for in Paragraph 6(c) of the Credit Support
Annex forming a part of the ISDA Schedule,
Counterparty agrees and acknowledges that,
during the period prior to the Settlement Date
(or any Early Termination Date), MLPFS shall
have the right to borrow from Counterparty
Shares held as Collateral (any such borrowed
and unreturned Shares, "Loaned Shares"). Upon
MLPFS' exercise of such right to borrow Shares,
Counterparty shall not be entitled, without the
prior consent of MLPFS, to terminate its loan
of the Loaned Shares to MLPFS until the Release
Date.
Counterparty further agrees and acknowledges that
MLPFS shall have all of the incidents of ownership
of the Loaned Shares, including the right to
transfer the Loaned Shares to others. Counterparty
hereby waives the right to vote, or to provide any
consent or take any similar action with respect to,
the Loaned Shares in the event that the record date
or deadline for such vote, consent or other action
falls prior to the return of any Loaned Shares.
Counterparty shall be entitled to receive all
distributions made on or in respect of the Loaned
Shares which are not otherwise received by the
Counterparty, to the full extent it would be so
entitled if the Loaned Shares had not been lent to
MLPFS, including, but not limited to: (a) cash and
all other property, (b) stock dividends, (c)
securities received as a result of split ups of the
Loaned Shares and distributions in respect thereof,
(d) interest payments, and (e) all rights to
purchase additional securities. Any cash
distributions made on or in respect of the Loaned
Shares, which Counterparty is entitled to receive
pursuant to the previous sentence, shall be paid by
the transfer of cash to Counterparty by MLPFS, on
the date any such distribution is paid, in an
amount equal to such cash distribution. Non-cash
distributions received by MLPFS shall be added to
the Loaned Shares on the date of distribution.
For the avoidance of doubt and without limiting the
generality of any other provision hereof, the
parties hereto agree and acknowledge as follows:
(i) that any obligation of MLPFS to pay cash
dividends to the Counterparty under the
previous paragraph may be set off against
the corresponding obligations of the
Counterparty to
9
<PAGE>
pay to MLPFS an amount with respect to
such dividends under paragraph (n) under
the caption, "Representations and
Agreements of Counterparty" with respect
to such Loaned Shares; and
(ii) on the Settlement Date or any Early
Termination Date, the obligation of MLPFS
to return Loaned Shares (if any) to the
Counterparty may be set off against the
corresponding obligations of the
Counterparty to deliver Free Shares
hereunder.
Independent Amount: Independent Amount with respect to Counterparty and
this Transaction means a number of Shares equal to
the Number of Shares.
Exposure: When calculating Exposure for purposes of
determining the Credit Support Amount under
paragraph 3(a) of the Credit Support Annex, this
Transaction will be disregarded.
Representations and
Agreements Of Counterparty: Counterparty represents and warrants to, and agrees
with, MLPFS as follows:
(a) Counterparty (i) has such knowledge and
experience in financial and business affairs
as to be capable of evaluating the merits and
risks of entering into the Transaction; (ii)
has consulted with its own legal, financial,
accounting and tax advisors in connection with
the Transaction; (iii) is entering into the
Transaction for a bona fide business purpose
to hedge an existing position; (iv)
acknowledges that in return for downside
protection against a decline in the market
price of the Shares below the Floor Price,
Counterparty is foregoing, in part, the upside
value of an increase in the market price of
the Shares above the Cap Price; and (v) in
exchange for prepayment of the purchase price
under the Transaction, Counterparty agrees to
sell (and physically deliver) the Shares to
MLPFS on the Settlement Date.
(b) None of Counterparty and any of its affiliates
is in possession of any material non-public
information regarding the Issuer. The
representation and warranty contained in this
paragraph (b) shall be true, correct and
complete on each day of the Hedging Period, as
if such representation and warranty was made
as of such day by reference to the
circumstances then existing; provided that if
such representation and warranty is not true,
correct and complete on such day, Counterparty
shall instruct MLPFS to refrain on such date
from engaging in hedging transactions as
provided under the caption, "Initial Hedging
Period".
(c) Counterparty has furnished MLPFS with copies
of all material agreements and or contracts to
which it is a party, by which it is bound, or
by which any Collateral is bound, that relate
to any Collateral.
(d) Neither Counterparty nor any person who would
be considered to be the same "person" (as such
term is used in Rule 144(a)(2) under the
Securities Act of 1933, as amended (the
"Securities Act"), has sold any Shares (or
security entitlements in respect thereof) or
hedged (through swaps, options, short sales or
otherwise) any long position in the Shares (or
security entitlements in respect thereof)
during the preceding three (3) months prior to
the Trade Date of this Transaction except as
otherwise listed on Annex A. Counterparty
covenants and agrees that until the Effective
Date, it will not sell, nor will it permit any
person to sell, Shares without the prior
written consent of MLPFS. For the
10
<PAGE>
purposes of the this paragraph and paragraphs
(e) and (h), Shares, including Deliverable
Shares, shall be deemed to include securities
convertible into or exchangeable or
exercisable for Shares and any other security
or instrument that would be subject to
aggregation under Rule 144(e) under the
Securities Act.
(e) As of the Trade Date, Counterparty owns
62,196,040 Shares (the "Deliverable Shares").
(f) Counterparty does not know or have any reason
to believe that the Company has not complied
with the reporting requirements contained in
Rule 144(c)(1) under the Securities Act.
(g) As of the date hereof (without giving effect
to the transactions contemplated hereby)
Counterparty is the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act)
of 72,367,040 Exchangeable Shares, which
constitutes 20.244% of the total of (i) the
outstanding Exchangeable Shares and (ii) the
outstanding Shares of the Issuer. Counterparty
shall comply with the reporting and other
requirements of Section 13 of the Exchange Act
relating to this Transaction.
(h) The Shares constituting Collateral are
currently eligible for public resale by the
Counterparty pursuant to Rule 144 under the
Securities Act. Counterparty acknowledges and
agrees that (i) the entering into of this
Confirmation will constitute a sale of Shares
for purposes of Rule 144, (ii) Counterparty
has not taken and will not take any action
that would cause such sale to exceed the
volume limitation of Rule 144(e), (iii)
Counterparty has not taken and will not take
any action that could cause the sale made
pursuant to this Confirmation to fail to meet
all applicable requirements of Rule 144 and
(iv) Counterparty will transmit a Form 144 for
filing with the Securities and Exchange
Commission (the "SEC") as soon as practicable
following the execution of this Confirmation.
Counterparty covenants that it will send to
MLPFS via facsimile a copy of each Form 144
and each filing under Section 13 or 16 of the
Exchange Act relating to this Transaction
concurrently with filing or transmission for
filing, as the case may be, of such form to or
with the SEC.
(i) Counterparty is not and has not been the
subject of any civil proceeding of a judicial
or administrative body of competent
jurisdiction that could reasonably be expected
to impair Counterparty's ability to perform
its obligations hereunder.
(j) Counterparty will immediately notify MLPFS
upon obtaining knowledge of the occurrence of
any event that would constitute an Event of
Default, a Potential Event of Default or a
Potential Adjustment Event.
(k) Counterparty is not as of the Trade Date, and
will not as of the Effective Date after giving
effect to the transactions contemplated
hereby, be insolvent.
(l) The parties acknowledge and agree that there
are no other representations, agreements or
other undertakings of the parties in relation
to this Transaction, except as set forth or
incorporated by reference in this Confirmation
or in the Agreement.
11
<PAGE>
(m) The parties hereto intend as follows:
(i) This Transaction to be a "securities
contract" as defined in Section 741(7) of
the Bankruptcy Code, qualifying for the
protection under Section 555 of the
Bankruptcy Code.
(ii) A party's right to liquidate this
Transaction and to exercise any other
remedies upon the occurrence of any Event
of Default under the Agreement with
respect to the other party to constitute
a "contractual right" as defined in the
Bankruptcy Code.
(iii) Any cash, securities or other property
provided as performance assurance,
credit, support or collateral with
respect to this Transaction to constitute
"margin payments" as defined in the
Bankruptcy Code.
(iv) All payments for, under or in connection
with this Transaction, all payments for
the Shares and the transfer of such
Shares to constitute "settlement
payments" as defined in the Bankruptcy
Code.
(v) "Bankruptcy Code" means Title 11 of the
United States Bankruptcy Code.
(vi) Upon the execution of this Confirmation,
this Agreement shall constitute a
"Preliminary Agreement" within the
meaning of the interpretive letter from
the SEC to Goldman, Sachs & Co. dated
December 20, 1999 (the "Interpretive
Letter") and that, upon the execution of
the Final Pricing Notice, this Agreement
shall constitute a "Final Agreement"
within the meaning of the Interpretive
Letter.
(n) Counterparty hereby agrees that promptly
following the payment of any cash dividend
with respect to the Shares (but in any case on
or prior to the seventh day immediately
following the date of payment of such cash
dividend), there shall be due and Counterparty
shall pay to MLPFS an amount in cash equal to
the aggregate amount of such cash dividend per
Share multiplied by the Number of Shares.
Representation of MLPFS: MLPFS hereby represents that it will conduct its
hedging activities as described under the caption
"Initial Hedging Period" above in accordance with
the Interpretive Letter, it being understood that
MLPFS will introduce into the public market a
quantity of securities of the same class equal to
the maximum number of shares deliverable on
settlement of this Transaction in a manner
consistent with the manner-of-sale conditions
described in rule 144(f) and (g) under the
Securities Act.
Interpretation: For purposes of the Equity Definitions, this
Transaction will be deemed to be a
Physically-settled Share Option Transaction with an
Exercise Date equal to the Valuation Date.
12
<PAGE>
Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing the copy of this Confirmation enclosed for that purpose
and returning it to us by facsimile transmission to the Attention of: Vivian
Jackson (Telecopier No. 212 449-2697).
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By: /s/ Elizabeth Murphy
--------------------------------
Name: Elizabeth Murphy
Title: Authorized Signatory
Confirmed as of the date first above written:
FEJ HOLDING INC.
By: /s/ Osamu Sato
--------------------------------
Name: Osamu Sato
Title: Vice President
13
<PAGE>
ANNEX A
List of Recent Transactions in Shares
Type of Transaction Counterparty Sale Price Quantity Date
- ------------------- ------------ ---------- -------- ----
Sale under Rule 144 CIBC $218.50 1,815,000 12/1/99
<PAGE>
EXHIBIT 4
IRREVOCABLE AUTHORIZATION AND INSTRUCTION
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPFS")
World Financial Center
North Tower
New York, New York 10281-1305
February 4, 2000
Ladies and Gentlemen:
o This is in reference to the second prepaid forward contract transaction ML
Transaction Ref. (to be determined) (the "Second Transaction") entered into
between MLPFS and FEJ Holding Inc. ("FEJH"), as evidenced by the
confirmation (the "Second Confirmation") dated as of February 4, 2000. The
Second Confirmation supplements, forms part of, and is subject to, the ISDA
Master Agreement (including the Schedule thereto and the Credit Support
Annex incorporated therein), dated as of January 27, 2000 (the
"Agreement"). The Second Confirmation requires FEJH to pledge shares of
common stock of JDS Uniphase Corporation (the "JDSU Shares") or shares of
Exchangeable Shares of JDS Uniphase Canada Ltd. ("JDSU Canada") to MLPFS as
Collateral. Defined terms used in this Irrevocable Authorization and
Instruction (the "Instruction") and not otherwise defined shall have the
same meanings as stated in the Second Confirmation.
In accordance with the terms and conditions of the Second Confirmation and in
order to effect an exchange of a number of Exchangeable Shares (the "Number of
Exchangeables") pledged to MLPFS (the "Pledged Exchangeables") for the Number of
Shares, FEJH hereby irrevocably authorizes and instructs MLPFS (and any
affiliate of MLPFS to which MLPFS may assign its rights and obligations under
the Agreement pursuant to the terms thereof) to take all necessary actions to
effect a "retraction" of the Number of Exchangeables as set forth in Article 6
of the Provisions Attaching to the Exchangeable Shares (the "Provisions"),
including without limitation: the presentation and submission to the transfer
agent for the Exchangeable Shares of a Retraction Request (as defined in the
Provisions) with respect to the Number of Shares designated in the Second
Confirmation as of the Trade Date; the designation of a Retraction Date (as
defined in the Provisions); and, to the extent necessary, the partial withdrawal
of the Retraction Request with respect to that number (if any) of Exchangeable
Shares that is in excess of the Number of Shares specified in the Final Pricing
Notice. FEJH agrees and covenants that it will not withdraw or cancel (or cause
the withdrawal or cancelation of) any Retraction Request submitted with respect
to the Pledged Exchangeables at any time prior to the Release Date other than
pursuant to the authority granted and instruction given hereby.
Sincerely yours,
FEJ HOLDING INC.
By: /s/ Osamu Sato
--------------------------------
Name: Osamu Sato
Title: Vice President
Accepted and agreed:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By: /s/ Elizabeth Murphy
--------------------------------------
Name: Elizabeth Murphy
Title: Authorized Signatory
<PAGE>
EXHIBIT 5
February 4, 2000
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPFS")
World Financial Center
North Tower
New York, New York 10281-1305
Dear Sirs:
This is in reference to the second OTC share transaction ML Transaction Ref. (to
be determined) (the "Second Transaction") entered into between MLPFS and FEJ
Holding Inc. ("FEJH"), as evidenced by the confirmation (the "Second
Confirmation") dated as of February 4 , 2000 (or such other date as may be
agreed between the parties). The Second Confirmation supplements, forms part of,
and is subject to, the ISDA Master Agreement (including the Schedule thereto and
the Credit Support Annex incorporated therein), dated as of January 27, 2000
(the "Agreement"). Defined terms used in this letter agreement and not otherwise
defined shall have the same meanings as stated in the Second Confirmation.
We, The Furukawa Electric Co., Ltd. ("FE"), hereby confirm to MLPFS that FEJH is
a wholly-owned subsidiary of FE. FE also acknowledges that the Second
Confirmation requires FEJH to pledge the shares of JDS Uniphase Corporation (the
"JDSU Shares") to MLPFS as Collateral.
In order to induce MLPFS to enter into the Second Transaction, FE acknowledges
and agrees that in the event MLPFS shall not have received as Collateral on or
prior to the twentieth Business Day following the Trade Date a Transfer of an
amount of JDSU Shares equal to the Number of Shares, due to the revocation or
withdrawal by FEJH of its Retraction Request (as defined in Article 6 of the
Articles of Incorporation of FEJH) then, MLPFS shall have the right to seek
compensation directly from FE (without first pursuing a claim against FEJH) for
any losses, expenses (including reasonable fees and expenses of counsel to
MLPFS), claims, damages or liabilities to which MLPFS may suffer or become
subject to, insofar as such losses, expenses (including reasonable fees and
expenses of counsel to MLPFS), claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon such revocation or withdrawal by
FEJH of its Retraction Request. The rights of MLPFS under this letter shall be
in addition to any rights or remedies that MLPFS may have under the terms of the
Second Confirmation and the Agreement.
FE shall be released from all of its obligations under this letter agreement
upon the delivery to MLPFS of an amount of JDSU Shares equal to the Number of
Shares as required under the terms of the Second Confirmation and the Agreement.
FE may not assign or delegate any of its duties hereunder.
Sincerely yours,
THE FURUKAWA ELECTRIC CO., LTD.
By: /s/ Junnosuke Furukawa
-----------------------------------
Name: Junnosuke Furukawa
Title: President and CEO
<PAGE>
Accepted and agreed:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By: /s/ Elizabeth Murphy
-----------------------------------
Name: Elizabeth Murphy
Title: Authorized Signatory
<PAGE>
EXHIBIT 6
EXHIBIT A
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
New York, N.Y. 10281-1305
February 7, 2000
FEJ Holding Inc.
c/oThe Furukawa Electric Co., Ltd.
6-1, Marunouchi 2-chome
Chiyoda-ku, Tokyo 100-8322, Japan
Attention: Assistant Manager
Fax No. (813) 3286-3709
Ladies and Gentlemen:
This Final Pricing Notice is the Final Pricing Notice within the
meaning of the Master Agreement (including the Schedule thereto and the Credit
Support Annex incorporated therein) dated as of January 27, 2000, between FEJ
Holding Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPFS")
(as supplemented by the Confirmation dated as of February 4, 2000 between you
and MLPFS, the "Confirmation").
For all purposes under the Confirmation, the terms of the Confirmation
shall be as follows:
1. Effective Date: February 8, 2000.
2. Number of Shares: 950,000.
3. Initial Payment Amount: USD 190,928,551.75
4. Initial Payment Date: February 11, 2000.
5. Initial Equity Level: 208.2668.
6. Floor Price: 206.9755.
7. Cap Price: 209.8288.
8. Valuation Date: August 28, 2000.
9. Settlement Date: August 31, 2000.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By: /s/ Elizabeth Murphy
---------------------------------
Name: Elizabeth Murphy
Title: Authorized Signatory
<PAGE>
Acknowledged and Confirmed:
FEJ HOLDING INC.
By: /s/ Osamu Sato
----------------------------
Name: Osamu Sato
Title: Vice President
